VIX Spike A Bad Omen For IPOs

At the turn of the year, a plethora of bullish forecasts for 2010 IPO volumes made for sexy headlines. Yet CFW preferred to emphasise the many risks to this outlook. They have already started to materialise, mainly as a result of the recent equity market correction. In particular, the fact that the Chicago Board Options Exchange Volatility Index or VIX, which is highly correlated with IPO levels, has spiked in the past weeks confirms our fears in terms of the impact of the equity correction on the IPO outlook, as we suggest below.

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